USA: +1 (725) 712-1730 
Sign in
| Chez Fred Bakery estimates the allowance for uncollectible accounts at 3% of the ending balance of accounts receivable. During 2016, Chez Fred’s credit sales and collections were $124,000 and $145,000, respectively. What was the balance of accounts receivable on January 1, 2016, if $270 in accounts receivable were written off during 2016 and if the allowance account had a balance of $660 on December 31, 2016? |
$45,000.
$900.
$43,270.
None of these answer choices are correct.
Expert Answer
| $43,270 | |
| Please find below the answer and please give thumbs up | |
| Statementshowing Computations | |
| Paticulars | Amount |
| Ending balance in allowance account | 660.00 |
| Ending balance in AR = 660/3% | 22,000.00 |
| Ending balance in AR | 22,000.00 |
| Add Collections | 145,000.00 |
| Total balance | 167,000.00 |
| Less Sales | (124,000.00) |
| Add Write off | 270.00 |
| Beginning balance in AR = 167000 – 124000 + 270 | 43,270.00 |
